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In the 2022 legislative session, Colorado lawmakers passed a measure to review Medicaid provider payments more frequently as part of a broader push to boost health care worker pay at a time of widespread staffing shortages.
The bill ramped up the review timeline for dozens of publicly funded health care services to every three years from five, a move meant to enable the state to respond more quickly to medical providers in financial crisis.
The rates are tied to a share of what the federal government pays for Medicare services, and vary by medical specialty. When reimbursement rates for some services fall behind, the review calls for targeted increases to bring their pay back to market levels.
Now in year two of the accelerated review schedule, Colorado budget writers worry they could fall so far behind they may never catch up.
Colorado’s Medicaid Provider Rate Review Advisory Committee this year recommended a $585 million reimbursement rate bump for 19 categories of health services up for review this year, a group that includes home-based care workers, EMTs and private duty nurses. Much of that would come from matching federal dollars, with the state general fund on the hook for $287 million.
Gov. Jared Polis’ budget request calls for a fraction of that — just $140,000 in general fund money to increase payments to home and community-based services — and cuts to others, like autism treatment providers who got targeted pay bumps within the last year.
And that’s just for the specialties up for review. His budget also proposes no across-the-board rate increase, meaning Colorado’s Medicaid providers would actually see their reimbursement rates for low-income patients shrink next year relative to inflation.
Colorado budget writers fear the state’s Medicaid program is on a financial path to something akin to a new negative factor — the former name of the K-12 funding shortfall that persisted from the Great Recession until this school year.
“It’s like we’ve created a new negative factor for Medicaid,” Joint Budget Committee Chair Jeff Bridges said at a November hearing. “I’m not happy about it, but I think that’s the place we’re in for the long-term future.”
Technically, lawmakers wouldn’t have to create another negative factor (later renamed the budget stabilization factor) in state law. That’s because unlike K-12 education, there’s no constitutional requirement to increase spending on Medicaid each year.
Nonetheless, the state’s Medicaid program may be headed down a similar path that schools were in 2009, with the governor and lawmakers facing pressure to forgo regular inflationary increases to balance the budget. And each year that lawmakers don’t fund rate increases that providers say are needed, the financial toll will only compound when the next group of medical services gets reviewed in the following year.
“We’re in a situation now with our budget, that it is unlikely, unless something significant changes, that we are going to be able to match the MPRRAC recommendations really ever, moving forward,” said Bridges, a Democrat from Greenwood Village.
“I’m glad that we look at all of them every three years so that we have correct data as we have these discussions,” he added. “But I don’t see a world where we hit those numbers.”
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A NEW NORMAL UNDER TABOR?
The state has to cut around $1 billion in spending next year to balance the budget before the new fiscal year starts July 1 — a deficit that’s driven in part by Medicaid patients simply using more care than they have in years past.
At the same time that Medicaid costs are rising more quickly, the state revenue cap under the Taxpayer’s Bill of Rights is growing more slowly due to cooling inflation, limiting how much the state can increase its budget.
That combination led Polis to limit increases in health care costs in his proposal for the 2025-26 fiscal year budget. But his plan is drawing fierce scrutiny from the JBC, which worries that the state’s health safety net already faces a financial crisis.
Federal stimulus dollars are drying up at the same time Medicaid enrollment has fallen below pre-pandemic levels. Many of those who drop off the Medicaid rolls wind up uninsured, leaving some hospitals and clinics with their highest levels of uncompensated care since before the state expanded Medicaid under the Affordable Care Act.
In a budget hearing last month, Sen. Barbara Kirkmeyer, a Brighton Republican, said she would push for deeper cuts to other areas in the budget to increase Medicaid provider rates instead.
“Our health systems … they’re on the edge and they are closing, they’re cutting staff, they’re reducing services,” Kirkmeyer said. “So for us not to consider this our most urgent need in this budget I think would be irresponsible.”
Bridges, however, suggested he isn’t sure the state can afford to do much more for Medicaid under TABOR without sacrificing things lawmakers value more, like K-12 education. General fund spending by the Department of Health Care Policy and Financing recently surpassed that of the Department of Education for the most of any state agency. And health care accounted for more than half of the state’s general fund growth in the current budget year, which ends June 30.
“This is the cap,” Bridges said. “This is what the government is limited to spend. If we had the Medicaid utilization we had last year, maybe we can hit this (requested increase) — but we don’t.”
WHAT TO WATCH THIS WEEK
THE BIG STORY
Historic shifts in Colorado’s presidential election results this year
The presidential election in Colorado this year brought some big shifts in county-level results.
Here are some of the numbers that stuck out to us:
THE SHIFTS FROM 2020
Trump fared better this year than he did in 2020 in a number of Colorado counties. The highlights:
Harris beat Trump in Colorado by 11 percentage points this year. In 2020, Biden beat Trump in Colorado by 12.5 points.
ANOTHER NOTABLE PUEBLO RESULT THIS YEAR
Another notable result in Pueblo that flew under the radar was in the District 2 Pueblo County commissioner race.
Commissioner Daneya Esgar, a Democrat and the former state House majority leader, lost her reelection bid to Republican Paula McPheeters, a political newcomer.
Esgar was appointed to the seat in 2023 after the resignation of fellow Democrat Garrison Ortiz.
Also unseated Nov. 5 was Commissioner Eppie Griego, who is unaffiliated. He will be replaced by Democrat Miles Lucero.
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THE POLITICAL TICKER
CAMPAIGN FINANCE
Defeat Boebert PAC, the federal super PAC that raised and spent money this year to unseat Republican U.S. Rep. Lauren Boebert, changed its name on Nov. 28. The group will now be known as the Defeat the Extreme Fund.
Scott Martinez, a Democratic operative and the former Denver city attorney, is still listed as the Florida-based group’s designated agent.
NEW STATE-LEVEL SUPER PACS
Two state-level super PACs have formed in recent weeks seeking to influence the 2026 election.
Protect Our Vote was created Monday with the stated purpose of educating “the electorate on various officeholders and to influence the 2026 selection, nomination, election or appointment of Democratic candidates for statewide public office in Colorado.” Scott Martinez is listed as the group’s registered agent.
The Service First PAC formed Oct. 31 with the stated purpose of helping elect Democrats. Its registered agent is Justin Lamorte, a Democratic political consultant who is working closely with Democratic U.S. Rep. Jason Crow, who is mulling a 2026 gubernatorial bid in Colorado.
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COLORADO GOVERNOR
Jared Polis ignites another firestorm on social media
Colorado Gov. Jared Polis may have stuck his keyboard in his mouth — again.
The Democrat was quick Sunday to turn to social media to criticize President Joe Biden for pardoning his son Hunter.
“While as a father I certainly understand President @JoeBiden’s natural desire to help his son by pardoning him, I am disappointed that he put his family ahead of the country,” Polis wrote on X. “This is a bad precedent that could be abused by later presidents and will sadly tarnish his reputation. When you become president, your role is Pater familias of the nation. Hunter brought the legal trouble he faced on himself, and one can sympathize with his struggles while also acknowledging that no one is above the law, not a president and not a president’s son.”
The blowback from the left was swift:
Polis’ post was quoted in The Associated Press, The Hill, Fox News, Washington Examiner and New York Post, to name a few outlets.
It comes after he was panned for supporting Robert F. Kennedy Jr.’s selection as secretary of the Department of Health and Human Services. Many commenters on social media pointed to Polis’ Kennedy post in reacting to his take on the Hunter Biden pardon.
However, a few other high-profile Colorado Democrats weighed in on the pardon Monday and criticized Biden:
ANALYSIS: The governor has always been one to voice his opinion on social media. But typically his hot takes are about nerdy things, like “Star Wars” and “Mork and Mindy.” Sharing hot takes about sensitive political issues is risky — and it undermines his go-to response to tough news-of-the-day questions that he’s a governor, not a pundit.
THE BIGGER PICTURE
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